Canadian Utilities Limited Class A · TSX:CU
Canadian Utilities Limited Class A — Investor Presentation (November 2019)
32 slides from Canadian Utilities Limited Class A's investor presentation, November 2019
Slide 1: Canadian Utilities Investor Presentation
CANADIAN UTILITIES INVESTOR PRESENTATION NOVEMBER 2019
Slide 2: Legal Disclaimer
LEGAL DISCLAIMER Statements made by representatives for ATCO Ltd. and Canadian Utilities Limited and information provided in this presentation may be considered forward-looking statements. By their nature, such statements are subject to numerous known and unknown risks and uncertainties and therefor
Slide 3: Table of Contents
TABLE OF CONTENTS 1 ATCO Group Overview Page 5 2 Canadian Utilities Limited Page 11 Regulated Utility Businesses Page 15 Energy Infrastructure Businesses Page 17 3 Appendix Page 25 INVESTOR PRESENTATION NOVEMBER 2019
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Slide 5: ATCO Group Overview
ATCO GROUP OVERVIEW
Slide 6: Organizational Structure
ORGANIZATIONAL STRUCTURE (TSX: ACO.X / ACO.Y) ~$6 billion common equity capitalization INVESTOR PRESENTATION NOVEMBER 2019 6
Slide 7: Track Record of Success: Earnings Growth
TRACK RECORD OF SUCCESS: EARNINGS GROWTH ATCO $355 million Canadian Utilities $607 million in 2018 in 2018 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 1
Slide 8: Continued Dividend Growth
CONTINUED DIVIDEND GROWTH ATCO $1.62 Canadian Utilities $1.69 per share 26 years of annual dividend increases* per share 47 years of annual dividend increases* Longest track record of annual dividend increases of any Canadian publicly traded company 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09
Slide 9: ATCO Credit Ratings
ATCO CREDIT RATINGS DBRS S&P INVESTOR PRESENTATION NOVEMBER 2019 9
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Slide 11: Canadian Utilities
CANADIAN UTILITIES ENERGY INFRASTRUCTURE 11
Slide 12: Organizational Structure
ORGANIZATIONAL STRUCTURE Canadian Utilities (TSX: CU / CU.X) CU Inc. ~$11 billion common ~$8 billion debt equity capitalization capitalization INVESTOR PRESENTATION NOVEMBER 2019 12
Slide 13: High Quality Earnings
HIGH QUALITY EARNINGS 2018 ADJUSTED EARNINGS 86% Regulated Earnings 14% Long-term Contracted Earnings INVESTOR PRESENTATION NOVEMBER 2019 13
Slide 14: Growth: Q3 2019 YTD Earnings
GROWTH: Q3 2019 YTD EARNINGS $432M $420M Q3 2018 YTD Q3 2019 YTD INVESTOR PRESENTATION NOVEMBER 2019 14
Slide 15: Regulated Utilities
REGULATED UTILITIES ELECTRIC TRANSMISSION ELECTRIC DISTRIBUTION $5,095M Rate Base $2,585M Rate Base NATURAL GAS DISTRIBUTION NATURAL GAS TRANSMISSION INTERNATIONAL NATURAL GAS $2,717M Rate Base $1,802M Rate Base DISTRIBUTION $1,211M Rate Base INVESTOR PRESENTATION NOVEMBER 2019 15
Slide 16: Rate Base Growth
RATE BASE GROWTH Regulated Capital Investment Mid-Year Rate Base Expected to Grow 3%- 4% per year $1.2B $1.2B $1.1B $13.4B $12.9B $1.1B $12.5B $11.9B $1.2B $10.3B $1.1B $8.9B $1.5B $2.2B $2.3B 2013 2014 2015 2016 2017 2018 2019 2020 2021 2013 2014 2015 2016 2017 2018 2019 2020 2021 INVESTOR PRESENTA
Slide 17: Energy Infrastructure Businesses
ENERGY INFRASTRUCTURE BUSINESSES ELECTRICITY GENERATION ELECTRICITY GENERATION ELECTRICITY GENERATION CANADA AUSTRALIA MEXICO 24 MW 176 MW 44 MW INDUSTRIAL WATER SERVICES HYDROCARBON STORAGE NATURAL GAS STORAGE CANADA CANADA CANADA 85,200 m3/day 400,000 m3 52 PJ INVESTOR PRESENTATION NOVEMBER 2019 1
Slide 18: Capital Recycling: Canadian Electricity Generation Sale
CAPITAL RECYCLING: CANADIAN ELECTRICITY GENERATION SALE • Sold our entire Canadian fossil fuel- based power generation portfolio for aggregate proceeds of $821 million in September 2019 • 12 coal-fired and natural gas-fired electricity generation assets located in Alberta, British Columbia, Saskatch
Slide 19: Canadian Utilities Direct Greenhouse Gas Emissions
CANADIAN UTILITIES DIRECT GREENHOUSE GAS EMISSIONS INVESTOR PRESENTATION NOVEMBER 2019 19
Slide 20: Electricity Generation Post Sale
ELECTRICITY GENERATION POST SALE Highly Contracted Expanding Renewable Portfolio Generation Capabilities Merchant 24 MW (10%) Hydro 59 MW (24%) Long-Term Natural Gas Contracted 185 MW 220 MW (76%) (90%) INVESTOR PRESENTATION NOVEMBER 2019 20
Slide 21: Electricity Generation Post Sale
ELECTRICITY GENERATION POST SALE CAPACITY RUN-OF-RIVER HYDRO SHARE (MW) 1 OLDMAN RIVER 24 2 VERACRUZ 35 NATURAL GAS 3 SAN LUIS POTOSI 9 4 KARRATHA 86 5 OSBORNE 90 TOTAL 244 INVESTOR PRESENTATION NOVEMBER 2019 21
Slide 22: Capital Recycling: Alberta PowerLine Sale
CAPITAL RECYCLING: ALBERTA POWERLINE SALE • Sold Alberta PowerLine Limited Partnership (APL) for total proceeds of approximately $300 million, and the assumption of approximately $1.4 billion of APL debt • Seven Indigenous communities acquired 40 per cent equity interest in APL • Canadian Utilities
Slide 23: Capital Investment Approach
CAPITAL INVESTMENT APPROACH • Disciplined and prudent approach • Utility and utility-like assets: regulated or long-term contracted • “A” range credit rating focus • The ability to leverage our operating model • Geographic diversification: Outside Alberta, North America, Latin America, & Australia I
Slide 24: Canadian Utilities Summary
CANADIAN UTILITIES SUMMARY International Natural Gas Distribution Natural Gas Transmission Natural Gas Distribution Electricity Transmission Electricity Distribution INVESTOR PRESENTATION NOVEMBER 2019 24
Slide 25: Appendix
ATCO APPENDIX
Slide 26: Regulatory Update
REGULATORY UPDATE Electric Transmission 2019 2020 2021 Application DecisionDecision General Tariff Filed ExpectedExpected Application (GTA) Gas Transmission 2019 2020 2021 General Tariff Application Decision Decision Expected Expected Expected Application (GRA) 2019 2020 2021 2021 to 2022 Generic Ap
Slide 27: Australia Utility
AUSTRALIA UTILITY We provide safe and reliable natural gas service to the Perth metropolitan area and the wider Western Australian community ▪ Approximately 761,000 customers ▪ 14,000 km of natural gas distribution pipelines INVESTOR PRESENTATION NOVEMBER 2019 27
Slide 28: Electricity Distribution & Transmission
ELECTRICITY DISTRIBUTION & TRANSMISSION We build, own and operate electrical distribution and transmission facilities ▪ 258,000 farm, business and residential customers in 242 Alberta communities ▪ Approximately 11,000 km of transmission lines, and delivers power to and operates 4,000 km of lines ow
Slide 29: Natural Gas Distribution
NATURAL GAS DISTRIBUTION We build, own and operate natural gas distribution facilities in Alberta ▪ Alberta’s largest natural gas distribution company ▪ Serves approximately 1.2 million customers in nearly 300 Alberta communities ▪ We build, maintain, and operate 41,000 km of natural gas distributio
Slide 30: Natural Gas Transmission
NATURAL GAS TRANSMISSION We build, own and operate key high-pressure natural gas transmission facilities in Alberta ▪ Transports clean, efficient energy from producers and other pipelines to utilities, power generators and major industries ▪ Owns and operates 9,200 km of pipeline ▪ Delivers a peak o
Slide 31: Financial Strength: Balance Sheet as at Q3 2019
FINANCIAL STRENGTH: BALANCE SHEET AS AT Q3 2019 ATCO Canadian Utilities 10% 11% 54% 52% 38% 35% Debt (net of cash) Preferred Shares Equity Debt (net of cash) Preferred Shares Equity INVESTOR PRESENTATION NOVEMBER 2019 31
Slide 32: Investor Relations Contact
www.ATCO.com www.canadianutilities.com Tel: 403.292.7500 Investor Relations 5302 Forand Street SW Calgary, Alberta T3E 8B4 Canada
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